AWA Market Report Reveals Sleeve Labels Are Expanding

Sleeve labeling, one of the world’s most dynamic label technologies and methods of product decoration, is continuing to evolve at all points of the value chain, from resin manufacture through film manufacture and converting practices. Innovative engineering solutions for label application are resulting in an ever-increasing understanding of the promotional benefits of combining high-quality graphics with complex container geometries on fast-moving consumer goods (FMCG) packaging.

World Demand for Sleeve
Labels by Format, 2017

All data courtesy of AWA Alexander Watson Associates

Claiming some 18 percent of the world label market, the overall sleeve labeling category is expanding at a 5.5 percent compound annual growth rate (CAGR). It is now the third-largest labeling technology globally, behind pressure-sensitive and traditional glue-applied labels. Global production volume in 2017 came to 11,213 million square meters. Current CAGR patterns are expected to hold through 2020—potentially beyond.

These and other findings are contained in AWA Alexander Watson Associates’ new fifth-edition market research report: AWA Global Sleeve Label Market Study 2018. It provides a global profile of a market where, today, flexo print is benefiting strongly from consumers’ preference for on-the-go refreshment—particularly single-serving beverages in contoured plastic bottles.

The category comprises different formats: heat shrink transverse (TD), stretch, roll-fed shrink (RFS) and roll-on-shrink-on (ROSO—a trademark of Jindal) machine-direction (MD) shrink sleeving.

AWA research shows that, across all the technologies, PVC is still the most highly used substrate, making up more than half of the market, with the more environmentally friendly PET-G taking second place.

Heat Shrink Sleeves

The contoured plastic container is a major driver of sleeve label volumes, and it is therefore hardly surprising that, today, the star sleeving performer is heat shrink sleeving, which uniquely provides the 75 percent shrinkage or distortion capability that complex container shapes demand.

The top to toe, all-round heat shrink sleeve on such bottles offers the additional ability to provide a much-valued, tamper-evident closure seal over the top aperture, as part of the label, and can also feature a perforated seam for sleeve label removal for container recycling after use.

Heat shrink sleeves claim around 88 percent of total sleeve label usage, a 66 percent share of total sleeving volumes in the beverage market and a 19 percent share of food-related applications.

Despite PVC’s generally declining global market share driven by environmental concerns, it still remains the most-used substrate for heat shrink sleeves, and is forecast to retain its leading position—primarily because of high-volume use in emerging geographical markets (particularly Asia Pacific). In the face of ever-changing costs for competitive film products, PVC provides reasonable pricing, high performance, and the required shrink range for most container geometries and end uses.

Global Sleeve Label Market by Materials, 2017

PET-G films claimed around 30 percent of global volumes in 2017. They are becoming increasingly competitive as more producers enter the market—especially in Asia—and their costs are therefore falling. AWA forecasts continuing growth in the use of the technology to 2020 at a healthy 5.8 percent.

In terms of imaging, technology choices have moved from gravure and solvent flexo on wide web presses to narrow web presses, as traditional pressure-sensitive label converters entered the sleeve label market to take advantage of the opportunity to broaden their offering to brand owner customers.